Understanding the Crypto-Asset Reporting Framework (CARF)  

A New Era of Tax Transparency for Crypto-Assets

The global tax landscape is evolving rapidly to keep pace with the emergence and growth of crypto-assets and e-money products. 

The Crypto-Asset Reporting Framework (CARF) is the OECD initiative designed to address the unique challenges posed by crypto-assets. 

Those in scope of  CARF need to prepare as their responsibilities start soon. The initial reporting under CARF is expected to start in 2027, with individuals and entities in scope expected to collect the information from 1 January 2026. 

Certain jurisdictions will delay implementation and start first exchanges by 2028. 

CARF provides for the automatic exchange of tax-relevant information. This article explores CARF’s key features, its scope and related reporting requirements. It also examines how CARF compares to the Common Reporting Standard (CRS). 

Who is affected by CARF?  

Both individuals and entities can be reporting crypto-asset service providers (RCASPs) if they provide services effectuating exchange transactions in relevant crypto assets for or on behalf of customers.  

This intentionally broad definition allows for the rapidly developing market and includes: 

• centralised and certain decentralised crypto-asset exchanges
• crypto ATM operators
• crypto-asset brokers, dealers, and market makers, whether acting as intermediaries or principals. 

Which crypto assets are covered?

CARF defines crypto-assets broadly as digital representations of value that rely on cryptographically secured distributed ledgers or similar technologies to validate and secure transactions. This encompasses:

• cryptocurrencies
• stablecoins
• derivatives issued as crypto assets
• certain non-fungible tokens (NFTs) that represent rights to value, membership, or property.  

Not all crypto-assets fall within CARF’s scope, the following are excluded: 

• crypto assets not used for payment or investment purposes  
• central bank digital currencies  
• specified e-money products. 

Some of these excluded assets fall under the scope of the CRS. 

What transactions are subject to reporting? 

CARF requires transaction-level reporting for:

• exchanges between crypto-assets and fiat currencies
• exchanges between different crypto-assets
• transfers of crypto-asset
• reportable retail payment transactions subject to de minimis threshold. 

CARF v CRS: Key differences and similarities 

While CARF shares many similarities with the CRS—such as annual reporting, due diligence obligations, IT system requirements and confidentiality standards—there are important distinctions.

• The scope of assets differs under CARF and CRS with no overlap between them. 
• Reporting obligations under CRS only apply to financial institutions, which are generally entities, but CARF can apply to both entities and individuals.  
• CRS reporting is based on account balances and payment/proceeds information, but CARF requires transaction-level reporting. 

It’s worth noting an entity can be both a financial institution (subject to CRS) and an RCASP (subject to CARF). That means they could have dual reporting obligations. 

1. Prepare for upcoming guidance 

The OECD is expected to release guidance notes to give both clarity on definitions and practical examples to help both member states and RCASPs in their preparation for CARF.  

2. Determine your obligations under CARF  

Entities and individuals should immediately seek to determine if they will be a RCASP under CARF. If so, they need to begin upgrading their systems and processes to effectively manage the obligations under CARF from 1 January 2026. 

3. Carry out due diligence 

RCASPs will have to collect self-certification from crypto-asset users. If they don’t get certification in time, they’ll have to halt transactions.   

Once it establishes a relationship with a user, a CASP must: 

• get a self-certification to determine the user’s tax residence(s) 

• confirm the reasonableness of the self-certification. 

For pre-existing users, RCASPs must get self-certifications within 12 months of CARF’s effective date, and updated versions within 90 days of any change in circumstances. 

How can PwC help? 

 Navigating the complexities of CARF can be challenging. Our experts are ready to help you:

• interpret the new requirements
• assess how they affect your business 
• help you meet your obligations under CARF. 

If you wish to understand if you might be viewed as an RCASP or need help with updating your systems to collect the required information, we’re here to guide you every step of the way. Get in touch with our team today.